Are you a strategic architect?

I recently had the opportunity to deliver a talk at a conference for teachers on the topic of “Are you a Strategic Architect?” The conference was attended by principals, deputy principals, heads of departments, and ordinary teachers, in as much as a teacher can or should be ordinary. Given the 12 glorious years I spent at school and the respect we had for our teachers, I must confess feeling a bit intimidated at first. You only saw the principal if you were in trouble, and never sought his company voluntarily! Fortunately my teachers were “children lovers” and I think back on them with kindness and nostalgia. I could have been a scholar for life!

I developed my views on what the strategic architecture or business model for schools could look like using the framework developed by Alexander Osterwalder of Business Model Generation fame. These are issues that every school need to deliberate upon together with their stakeholders, which include children, parents, teachers, and the authorities (including governing bodies), to mention but a few! This posting is for the principals and teachers of our schools, if I may be so arrogant. The principles are equally valid for businesses across the board, however, as well as for other non-profit and even Government departments.

First of all, schools need clarity on their “clients.” Are the children their clients? The parents? The universities? Society at large? Or are they all “clients” of the school? Being clear as to the identity of the client, is important as it will impact the school’s attitude towards this stakeholder. It will also influence the nature of the customer value proposition that you will need to offer, given who you selected.

Secondly, schools need to deliberate the customer value proposition (CVP). What value are you creating for the selected/identified/mandated client segment? Schools do not have the luxury of only transferring knowledge anymore. This used to be the primary CVP in earlier years. The emergence of technology and entities such as Google has brought about a generation with equal access to content! So if this CVP has been destroyed, what new source of CVP should schools concentrate upon? Should we now concentrate on developing life-long learners? Should we concentrate on helping pupils to become thinkers? I am not really sure that we have a choice in this regard!

Thirdly, we need to have clarity on the “distribution and communication channels and methods.” In the past, the school as a facility was centre in the education process. Nowadays, given the technology I have already referred to, is it really necessary to go to a physical entity? If we are only transferring knowledge, why should our children go to school? If however, we also see the development of the pupil in all the dimensions as part of the CVP, then we indeed should see the school as important. We should also see the use of technology as a complementary distribution channel. This would require that our teachers are also educated in the use of Facebook, Twitter, Flicker, WordPress, YouTube, etc. The current state of knowledge and use of these technologies? I think we would be somewhat shocked!

The fourth building block of the business model for schools entails how we tie our stakeholders to our school. How do we get our client groupings excited about our school? How do we get them to gush about our school? Or do we just accept that we are the school and that’s that? Do we as schools need to strive towards making customer evangelists of our client groupings? How do we do it? Again I think we do not have an option!

The fifth building block entails the sources of revenue. Traditionally schools receive their budget from Government. This still is the case. However, in South Africa in any case, this budget is never enough. Where do schools get additional funds? Fundraising activities? Sponsors? School fees? This latter source has become quite expensive for parents in a lot of the schools. It costs as much to keep a pupil at school as it costs to keep a student at university! The reality is that schools need to be innovative as to where they get funds from. And society at large needs to accept some kind of responsibility to help schools in getting these additional funds. Saying that we pay taxes and that should be enough, is simply not sufficient anymore. Our children are the victims of this approach.

Point six, we now need to identify the key resources needed to deliver this CVP. In addition to the obvious resource of the school, we need to acknowledge that our teachers are probably the most important resource! Schools are only as good as the teachers in front of the class! Especially if we acknowledge that the CVP has migrated from transferring content to developing pupils! This again places some pressure on the budget of schools as they now need to also spend money on the continuous development of teachers.

The seventh building block entails the key activities required to deliver the CVP. Teaching is an obvious choice. People development also comes to mind. Remember that here we refer to the activities additional to the operational processes. Changes in the CVP and resources, as well as funding requirements, would necessitate changes in the key activities.

The eighth building block entails the key partners the school needs. Again there is an obvious choice of the Department of Education. However, here we need to make our parents an important ally of our school. Involving the pupil as a partner in his/her own education and development also needs to be seriously considered. I have heard stories of school children enforcing the values of the school in a very positive manner. Also, what about universities which serve as the recipients of these school pupils? Even large businesses in the vicinity can be tapped into to help high school pupils to understand the world of business in a much better way that school teachers could!

The last building block of the school’s business model entails the cost model. What are the main cost elements of your business model? Teacher salaries serve as one of the main items on this list. What are the other items? Should these be the items that the school should be spending their scarce cash resources on? What are other schools doing? Where can we copycat other best practices? What should we therefore be outsourcing?

Having identified your business model does help to focus your attention, energy, and activities in the more appropriate direction. It does require schools to constantly assess the relevance of their business model. It does require schools to innovate on a consistent basis to develop a model, or building blocks, which will add the most value in a very real and tangible way.

It is also important to realise that this business model needs to be externally and internally aligned. External alignment requires it to fit the challenges and requirements of the external environment. This environment is not stable and therefore the model needs to be adjusted constantly. Experts such as Adrian Slywotsky make the point that your business model needs to be innovated at least every 4 to 5 years!

Internal alignment requires the building blocks to be aligned with each other. Your key activities, for instance, need to be aligned with the CVP, the customer segments selected, and the revenue streams. If you have identified people and pupil development as part of your CVP, your teachers need to be developed as to be able to deliver this CVP. The demise of the Outcomes-based education approach in SA can probably be attributed to the inability of the teachers, and the inadequacy of the resources, to deliver this approach.

The development of a business model will not guarantee success for the school. However, the absence of a viable and relevant business model will probably guarantee failure. Or worse, allow the schools to stumble along the path of mediocrity in the guise of performance, consuming scarce resources along the way!

3 Responses

Hi Johan,
This is an article we need to digest properly – especially school governors. I am involved with FEDSAS, the national school governing body association, as a parent and what we see on a national level is heart breaking. Given that the average successful school with say 900 learners today has a budget of ±R8 to R10m which comes from school fees (and therefore paid by parents) and the state’s only contribution is for 50 to 70% of salaries (on top of the budget), governors need to focus on what they offer (specialise for excellence) and where they get the funds for that. This unfortunately drives the management at today’s schools. I believe the future focus by governors must be on innovative ways of utilizing technology to reach more students with the same number of teachers, and to get more funding from other sources. And parents and community must get involved to support. Quite a daunting task ahead! Gert Heunis

[…] To do this in more detail we look at the third force, namely the Aims Perspective. This force refers to the vision, mission, objectives, business model, and strategies of the company. It is important that this force is aligned with both the ethos of the company and the external environment. Should it not be, we would be developing strategies that will either not address the opportunities and threats of the external environment, which could be life threatening, or not be implemented as it is in conflict with the ethos. Both scenarios are equally devastating! I have already dealt with the concept of a business model in a previous article, i.e. “Are You a Strategic Architect?” which can be found at http://johanhburger.com/are-you-a-strategic-architect/. […]